Caoineag's Personal Finance Blog

Its a little early to come out of hibernation, but that's just the type of girl I am. I am ready to get back to work on the house projects (little ones, one at a time, I promise) so our allowance will need to go up to accommodate the things we will need to pick up like paint, trim and tools.

We have a lot of things that are mostly finished so I think our projects will mostly be about completing what we have started.

So it took a little over a year but as of December 2009 I am back where I started before I bought a house (Nov 2008). I had figured at the time that the house would set us back a year on our debt repayment and I was right. I must admit though, I hadn't realized both DH and I would have a moment of unemployment in there and a 1/3 of our income cut out this year. As a result, I am a little surprised to see that we stayed on schedule.

We have increased our net worth this year by about 9k with the majority of that being mortgage principal paydown (almost 6k). That's 4.2% of our loan.

The last time we used a credit card (other than paying in full) was in April for the cabinet refacing and that deal will be paid off in March 2010 with no interest paid.

We actually had quite a few big surprise bills this year that we have paid cash for no problem.

From January 2010 on, I will be setting records for my networth which is really nice. DH will be contributing 15% to his 401(k) again and I will finally max out my roth this year (hoping to max out his roth as well but we will see).

The advantage of having gotten so many of our fixer upper projects done this year is that the house is livable and we have lost the desire to move as quickly on future remodeling. Spacing out repairs will allow us to pay off the debt quicker and build a larger savings cushion.

I've estimated our taxes this year and we are looking to receive a refund. I don't want to adjust our withholding though because without the window credit, we would have been paying in this year despite the unemployment. Also DH's income can jump very quickly which makes tax estimating a haphazard guessing game.

Overall its been a good year all round.

Yesterday, we take the car in to be fixed on our way to work (planned). Of the two potential repairs, its the more expensive one (of course). For the second day in a row I contact a company regarding a nonworking gift certificate (no response on either day) and the crowning piece of disaster, my phone.

I decide I need minutes on my phone but something is up with the website so I call. Guy doesn't listen well and decides he knows what my problem is and promptly deletes my phone number of 5 years (heart attack begins). I spend the next 60 minutes mostly on hold while he tries to fix it. Then the phone hangs up on me. When I call back, the line is so busy that they won't let you wait to talk to someone. He did fix it online eventually but my phone thinks its a different line. Fortunately the real phone number works its just labelled wrong (no I am not going to call so he can break it again). I finally manage to buy minutes for my phone.

This all occured before my work day had even begun. After work, we get the car back and realize that the little rattle they managed to fix but that they created a bigger rattle that made the car sound like it was trying to tear itself apart. *Sigh*

So I both started and ended my yesterday on a sour note. At least a client brought us fancy chocolate wafers and cookies. Dark chocolate makes everything better.

So far today I have had more luck. Got the company on the phone re the gift certificate and sent the car back to the repair shop so they can fix their oopsy. Our current stance is you broke it, you fix it. They are going to have to talk fast if they want us to pay for a second repair since they had all day yesterday to get it fixed right the first time. They didn't call till 4 yesterday despite having told us the repair would only take half a day. The slowness of their work is starting to get obnoxious but until this repair, they did a good job for a decent price so we have been putting up with the repair times.

Is this week over yet? Blah.

I like 401(k)s. They reduce the tax you need to pay, they help you save more than you could in an IRA and sometimes you even get matching funds.

Hubby is getting access to one through his temp agency. So what's the problem? Its through the temp agency. Technically hubby is supposed to get hired on by the company he is currently working for so he might get it started and then have to transfer the money because he got hired.

The other issue? Contributing will delay the debt payoff by two months.

That said, I am still leaning towards having him do 15% to the 401(k). If he doesn't get hired by the company he is working for, this will keep our access to a 401(k) so that we can squirrel away money. I hate delaying the payoff but its better to establish good habits now then to wait for a better time later (which may never come).

I will just have to make sure to fully fund my roth by the end of next year (which should be doable despite the setback).

I don't actually know which I value more. I have a non-deductible mortgage (since its not big enough to allow me to itemize) at 6% apr and a deductible student loan at 5.15% apr. Come July, I am going to have to decide which I want to start prepaying. If I prepay the student loan, I increase cashflow by $200 once its gone (and its only about $13k now so not big). After that, I can throw all of that at the mortgage.

If I prepay the mortgage (which has fha insurance on it) I get to pay off much more interest but I don't free up my cashflow for a long time. The student loan will naturally be paid off before the mortgage even though the mortgage is a 15 year.

Course all of this changes again if I refinance next year(if I refinance, it would be without the fha insurance thanks to equity in the home) which would also lower the interest.

I have awhile to solve this question or to have things change on me so its not a huge deal, its just surprising that I can't decide which choice I like better. They are a little too close.

Today I paid another one off. I won't get to do that again until February. We also started our allowance diet yesterday which should last till the end of March. It allows us to stay on pace despite some expenses cropping up that we weren't originally counting on. That said, we may have a few more show up to slow us down. In fact, I am practically counting on it. That's part of the reason that I am not making larger credit card payments, I need a cushion of 2k to feel comfortable.

Looking at the upcoming debtfree budget, we will once again have all of our bills and allowance fit on just my paycheck (or even hubby's current base pay since he is making a little less than me momentarily). That's a nice feeling.

By my calculations, we will probably get back around $900 this year (only getting that much thanks to 2 months of being unemployed in our house, otherwise we would still be paying in). That's all fine and dandy except that this year we had a $1500 energy efficiency rebate which is the only reason we aren't paying in. Next year we start paying an extra $500 per year in taxes to repay the homeowner credit.

On top of that, Hubby might get hired on full time next year. Full time will mean access to a 401(k) next year so we may be able to sock enough away to get the tax back down. Oh, and most likely I will regain access to an HSA this upcoming year. I bet that could get our taxes down. Still would need the 401(k) though to get it the rest of the way under the $1k no penalty limit...

Bah, this is much easier when both people are salaried. Hubby's overtime kills our tax bill every year, lol.

Positive Net Worth (should be reached in Feb)

Debtfree (should be reached in June or July at current pace)

Max out one Roth IRA (should be reached in December, will probably max the other one for 2010 in Jan 2011)

Accomplish 2 home improvement/repair projects(preferably landscaping and electric work).

2 real vacations (don't have to be long, just go somewhere new).

And I am pretty sure we won't have anymore money after all that (well, besides the savings towards more home repairs but that is accounted for another year).

I paid off the card that wanted to jack my interest rate up to 30% (but don't worry, after two months of paying on time they would refund 10% *note sarcasm*) with a 0% offer yesterday. This really should be the last balance transfer because all my interest rates are locked in now (aka no one else can tell me that they have a lovely present for me).

I have also scheduled the payoff for one of my cards for 12/04, which means I will be down to two cards.

Saw that my promotional rate for my internet was going to expire so I called them up and agreed to a 2 year contract in exchange for a permanent rate reduction and faster speed (this will probably be the last time you read that I signed a contract, with everything else I am moving away from contracts but I will be homeless before I give up my internet connection).

I also ported my phone number to net10 now that I know for sure that it works and have used most of my Tmobile minutes.

Hopefully that will be it for awhile. I hate trying to make time for phone calls and playing hot potatos with the credit cards and savings accounts.

1 Pets
Got rid of saltwater tanks, limit toys and treats to reasonable level

2 Video Games/Bikes
Try to buy used, replace as things break

3 House Repairs
Plan cash expenditures to level needed

4 Financial Independence
Pay off debts quickly, keep saving for retirement

5 Eating Out and Eating In
Set a reasonable expenditure level and stay under

6 music/gardening/decorating/books
Occasional splurge, keep impact on budget minimal (shouldn't have its own category)

7 Travelling/Car Maintenance/Entertainment
Minimal till debt is gone, then goes up to have its own category

8 Charity/Generosity
usually project based, after debt payoff, gets its own category

9 Electronics/Furniture/Eventual Car Replacement
should be another 5 years before this needs to become a category

This is my current priority list. Everything that I value that has a strong financial impact on my life is listed whether I need to spend on it right now or not. I am sure it will change in the future but for now this is it.

This list is based on how strongly I feel about it not the amount of money that is required to support it. Underneath each I listed my plan for keeping the expense part down. Surprisingly, financial independence is fourth on the list. I would honestly work longer for the items listed above it. Strange hunh?

Yes, I am singing that song in my head. Blame the adrenaline rush of lifting weights this morning.

We finally have our new trikes! And this weekend is supposed to be gorgeous. Soo much fun. We plan on taking them down to the old trail that we used to ride all the time on our road bikes so that we can get an apples to apples comparison. Its going to be so amazing not to have a stiff neck and a sore tailbone.

The trail there and back is roughly 30 miles so we may find out that we can't do that distance right off the bat (or more likely, not with any great speed) despite it being relatively flat but its worth getting a good comparison in.

For those of you curious, yes my husband and I will bike all winter long when its not below 30. 40 and about is just fine, especially since 3 wheels means slush and snow are far less hazardous. Oh and no more diaper pants! Yeah!

(By and by, my buyer's remorse is gone, I only have buyer's remorse before paying for something, not after, go figure.)

Spent $110 on groceries this past Thursday but that included stock up and Thanksgiving meal prep so its hardly surprising. Still feels weird to have it more than $30 though.

I rejigged my numbers again(I know, you are completely shocked, I never do that) and I can pay off one of my cards in December and another in February. After that, I will just be down to one which simplifies things immensely. Right now the numbers are pointing to a June debt free date but I wouldn't hold your breath, spring seems to expensive thanks to yard stuff but I am going to try to keep that down.

Still need to buy our plane tickets to our home state for my brother's graduation and make the hotel reservations but I figure I will do that in December since this month has been so hectic. That however, is the last of the big expenses till spring so that is nice.

Today I am paying off the first of my remaining credit cards. $4344 going poof. This would be more impressive if it was my largest remaining but sadly it is not. However, we are in the final stretch of the pay off so all is well.

So hubby suspects that his current workplace will be offering him a permanent position within the month, it was a condition for his manager to give up her best workers to another department. Should be interesting to see how this plays out, especially since base pay tends to go up when you go from temp to permanent. It would be really nice for him to have benefits again too.

We shall see. In the meantime I am anxiously awaiting the final payoff on one of my credit cards scheduled for this Friday which will be nice. We will be dropping from 4 credit cards to 3.

I am also waiting to hear this week how much the final price tag on our bikes are. At least it will keep us from spending a lot of money on the nice days. If you are biking for half a day to a day, its hard to spend money at the same time, lol.

By that I mean, cut our allowance for the months of December and January to $100 per week (includes groceries). It would let us build up some more savings so that I felt more secure. I think I have just gotten used to having a set amount of money in savings and would like to keep it that way.

Those two months don't involve a whole lot going on so it would make it easier to stick to as well. I have also been cutting back on the eating out because I don't need to be eating all that junk food.

The advantage here is that since I am the big spender and instigator, if I cut back, our expenses go down. I will have to see how it works out...

So my Citicard who was the only card that hadn't raised rates due to market conditions, just jumped mine up 4.4x its current level. Ouch. I always feel like I did something wrong when I get increases like that but in my head, I realize that its just the economy and record defaults. Still. Nasty raise in rate. So another 0% balance transfer has been accepted elsewhere so I can pay the card in full and not close it by Dec 20th (I just got the notice Friday).

I basically break even when you take into account transfer fees (this is the one card that had some interest being applied) so I shouldn't complain too much. I have redone the budget to reflect the change.

So after the credit card payoff this Friday and this new transfer, the credit cards will look like this:

CC#1 11,330 0% (My payment $200)
CC#2 2,380 0% (My payment $40)
CC#3 4,082 0% (No min, no payment)

I really can't wait for July 2010 when these are all paid off. *Sigh*

My TV just went on sale so I will be getting $100 + tax back. It pays to watch the sales online when you have a 60 day price guarantee.

I tend to send over 40% of our income towards debt. As a result I expect us to be rid of the debt by July. That said, I sometimes wonder if we focus on repaying debt so quickly that we forget to enjoy the here and now.

I am a big fan of the 50/30/20 budget but don't actually put it into practice. For one because my necessities don't require a whole 50% and for another reason is because we don't get close to even 20% on wants let alone 30%...

I have tried to loosen our purse strings a little so we can enjoy things but always feel guilty when I do.

I used a calculator to figure that since I have started my retirement accounts my personal rate of return has been 18%! Since I have only had a retirement account for 2 1/2 years, that's not super impressive but does show the advantage of buying low.

I am pretty sure it will drop for the next ten years till it gets to a real rate of return but nonetheless its encouraging. Mainly because I was thinking that a ROR over 6% was completely unrealistic over the longterm (now I am wondering if maybe it is possible). I guess I had thought that with this market I was only doing about 6% now and figured if this is one of the more profitable years, then 6% was definitely not possible.

In defense of my ignorance, I did have to do a little digging thanks to some rearrangement of funds to figure actual contributions and expenses.

DH's personal rate of return is better though. He had the advantage of free money in his 401(k) so I think his is closer to 26% overall. Hopefully his next full time job will offer a 401(k) again with matching because that was extremely handy for squirrelling away money. (I only have an IRA as my retirement fund, and that's true for quite some time to come).

I expect next year to be bumpy but that just gives me another opportunity to buy cheaply.

March 2011 Electric panel + wiring
Sept 2011 New Asphalt roof
Sept 2011 New Siding
Sept 2011 New Gutters
Sept 2011 New Fence
March 2012 New Furnace
Aug 2012 Bathroom remodel
Sept 2012 Refinish hardwoods
Jan 2013 Newish car
Jan 2014 Payoff student loan early

I like this time line better. Not the least of which it fits the 5 year timeline I have for prioritizing house repairs over savings (not over retirement savings but over mid term savings). What I don't like is the asphalt roof. I may have to get over that though if the metal is as expensive as I believe it to be. Especially since this list doesn't include my dream projects (anything that is more than 10 years away) of redoing the basement stairs and refinishing the basement.

I am beginning to see why people like using HELOC's for remodeling. It certainly allows you to get the remodels faster. But since our goal is to be completely debt free at an early age so we can focus on saving, that is not something we are interested in.

July 2010 Last of cc debt paid off
March 2012 New metal roof
April 2012 New siding for carport and top of house plus new gutters

Sept 2012 Replace fence
Oct 2012 New electric panel and wiring
May 2013 Bathroom remodel
Aug 2013 New furnace
May 2014 Refinish hardwood floors
Jan 2015 Relatively new car

Hmmm...there has got to be a way to cut costs down to make this go faster. *Sigh* This is what I get for wanting to do everything right the first time. I am sure as the time gets closer I will figure ways of getting what I want for less. Its just painful to see how long all this work is going to take.

I have been writing a lot of blog posts then not publishing them lately. Lots going on just not really blog worthy or even easily explained.

So I guess this will just be a general update. We are finally going to buy our recumbent trikes for bike riding. We are doing it in the fall so that everything is ready for when the weather get nice again (in Denver, we have had days in January that have been nice enough for biking). We have been wanting them for two years now but buying a house came first and we finally have enough saved up to pay cash.

October was financially one of the best months we have had in awhile. Today I set up the payoff for a credit card for next month using this month's excesses. All in all, a very good month.

Well, I still have about 267 minutes to use up on my current phone but I have ordered a Net10 phone. While the Tmobile was easy and cheap, the phone didn't actually work in the house so everytime I answered the phone I had to go outside. Far too obnoxious. Assuming I wasted my remaining minutes(which I won't), the cell phone was the equivalent of $25 per month.

Since DH's phone is the equivalent of $8.30 per month, that means we saved about $39 per month over having a plan. That was more than I thought I would save so prepaid is definitely the way to go for us.

I won't be switching him, he uses his phone so rarely that Tmobile is definitely the cheapest option (Net10 would be 16.60 per month for him). I on the other hand have chatty family and I am the go to person when someone wants to call us so the higher usage requirement for Net10 shouldn't actually impact my costs at all. I just hope this phone works in the house (should, sprint has excellent coverage in my area).

If it doesn't, that will mean only AT&T has coverage inside my house and at that point I would go back to Tmobile (AT&T's prepaid is too expensive for what it is).

Received the first settlement offer which was twice what I was thinking it would be (my insurance had been kind on the depreciation). As a result, I do have a base number for the month of October now. It will probably be a couple of months before the final tally is in but I am okay with base numbers and guesstimating the rest.

Since I have been bargain shopping for the replacements, I am going to have some money left over (couldn't replace everything even if I wanted to so no, I am not really coming out ahead but I am trying to look on the bright side). As a result I will be able to speed up my debt repayment and keep a higher than expected cushion. June will definitely be the last month for debt (assuming continual employment of course).

I was tempted to put some of the money into an IRA for hubby but we are just so ready for the credit card to be gone that I think we need to just put it on the debt and accept that I won't be maxing his out until next year. I am just so looking forward to that money going into short term and long term savings instead of into credit card payments.

My ethernet port was broken on my computer. The port is part of my motherboard which doesn't have any room for expansion (can't just add an ethernet card). I ended up deciding to upgrade the major components since I needed to replace them anyways (likely excuse).

I probably spent a week shopping for all the parts, decided to do an upgrade instead of a completely new computer simply to keep costs down. It cut the total cost in half. That said, I am building a monster.

I have the money but I do feel a little guilty. I was going to wait. Everyone else knew it wouldn't be for long but my goal was to wait as long as possible. Why is it that once I decide a plan of action, I almost immediately put it into place?

I used to be a big time procrastinator (stopped because it became too painful thanks to sleep deprivation and project pile ups) but nowadays, once I decide to do something, its already started.

I think part of my problem this time is that this is the first time I have done this type of project so I am excited to get working on it. Its built-in entertainment. If I had stuck with prebuilt computers, I probably could have waited months (or until I had wanted to play my pc games and they wouldn't run because I can't activate the reinstalled windows). Paying money for something isn't nearly as exciting as doing something.

*Sigh* Does anyone else tend to jump the gun on projects? I seem to always need to pace myself and I am not sure how other than don't do it if I don't have the cash.

My computer is dying a slow painful death. At 5 years old, 5 moves, 1 of which was cross country and many dusty apartments, it is clear that something is seriously amiss (black screen). I am thinking graphics card. I suspect that my ethernet port is not far behind (though hard to test at the moment with no graphics). I am going to open up the case tonight and do an idiot check on the cords inside but I have been waiting for this machine to croak for awhile. Electronics don't like being tortured.

So a graphics card is only $100. Not bad, except it might not be the graphics card. Then I wasted $100. Or it might be the graphics card but something else might fail soon.

I could build a new one for $922. Or even cheaper if I open the computer up and decide the power supply and case can be reused. But I don't want to spend the money right now.

*Sigh* Probably will just make do with hubby's netbook for a couple months. Then build a new one.

Finished! No more changes on this month. Normally I do networth at the beginning of the month and just alter it as necessary but don't think I will be doing that for October, simply too much will be coming and going for even a beginning estimate. I hate it when I can't plan out my numbers

I already flunked out of the no heat contest. We had a cold snap that dropped the house temperature. General rule of thumb in our house, if its 63 when we get home from work, the heat needs to be on.

Its harder than it seems after a break in. I decided that instead of waiting, I would get the few items I need to feel normal in my house. The rule is, do I care if I have spent this money if tomorrow all my stolen goods are returned. I am also basing this off of what I can afford, not what the insurance will pay.

As a result, things do feel back to normal now. Obviously I haven't replaced everything but I have enough key items to feel like its my home and I can do things. I also have some security measures in place that can limit my losses if something like this happens again.

I figure my total costs before insurance to be $2500. This includes upgrading items that have reached obsolescence (most of which couldn't be replaced with exact even if I wanted to, not available anymore). Course if I tried to replace everything, it would be considerably more but I think I will be fine with this.

This may or may not set me back. There are a lot of items I will not be replacing so that cash value will be put towards what is replaced. (We have replacement cost insurance but if you don't replace, than its actual cash value).

Ah the joys.

Probably the less I say about this the better but its definitely finance related. We were robbed over the weekend but our animals are safe, we are okay and the robbers weren't malicious or thorough.

I have spoken with the claim specialist and we are well covered so technically I should only have to pay the deductible and they will pay the rest, including actual replacement cost for anything bought within 180 days.

Obviously we will not be replacing everything. Some things we simply won't be able to find that fast and others we feel no need to get again. We will be upgrading 3 items when we go to replace (they were nearing the end of their lives anyway so we will be grateful for even just cash value).

We also intend to put security features into place before we start replacing things. Though to be fair, these robbers got in through an unlocked window. Ah the joys.

So for the first time ever, I took a look at a full year's worth of actual spending (always done monthly but never put it together or kept it around). So from August 2008- July 2009 the damage was 88k. Youch. Pure house repairs and tools to do house repairs was $26k of that.

The one positive note is that starting May 2009 you can see the spending dropping like a rock. That's when we finally got caught up with most of the expenses of owning this home. And its stayed at the new rate since then. So now house repairs is just part of the allowance budget (or the savings budget for the big projects).